The RBA's decision to lift rates by 25bp earlier this week does not mark a full-fledged resumption of its hiking cycle. Rather, we believe the Bank was simply taking out additional insurance to make sure that inflation returns to its 2-3% target over the medium term. Elsewhere, in New Zealand, survey data published this week showed that firms’ inflation expectations have continued to trend down, while activity data suggest that the economic downturn has further to run. All in all, the numbers reinforce our view that the RBNZ's job is done.
Become a client to read more
This is premium content that requires an active Capital Economics subscription to view.
Already have an account?
You may already have access to this premium content as part of a paid subscription.
Sign in to read the content in full or get details of how you can access it
Register for free
Sign up for a free account to gain:
- Unlock additional content
- Register for Capital Economics events
- Receive email updates and economist-curated newsletters
- Request a free trial of our services